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2024 MarsdenLR 2287
HIGH COURT MALAYA SHAH ALAM
SANDORA MOHD PANUT &ORS – Appellant
Versus
KOPERASI FELDA BUKIT CHERAKAH SELANGOR BERHAD & ORS – Respondent
[Civil Suit No: BA-22NCvC-535-12/2022]
Civil courts retain jurisdiction over disputes involving cooperative societies, despite the Malaysia Co-operative Societies Commission's authority under the Co-Operative Societies Act 1993.
Headnote:(A) Co-Operative Societies Act 1993 - Section 82 - Jurisdiction of the Malaysia Co-operative Societies Commission - The court examined whether the dispute fell within the jurisdiction of the Commission as per s 82, determining that civil courts retain jurisdiction regardless of Commission's purview (Paras 29, 31, 35).
(B) The Defendants' application to strike out the Plaintiffs' claim was dismissed as the court found the claims were not frivolous or vexatious and proper jurisdiction was assumed (Paras 36).
Facts of the case:
The Plaintiffs alleged breaches of statutory and fiduciary duties by the Defendants, members of a cooperative society, and sought various declarative and injunctive reliefs.
Findings of Court:
The court held that it had jurisdiction to hear the dispute and dismissed the Defendants' application to strike out the claim.
Issues: The main issue was whether the court or the Malaysia Co-operative Societies Commission was the proper forum for the dispute.
Ratio Decidendi: The court ruled that the civil courts maintain jurisdiction over disputes involving cooperative societies, irrespective of the Commission's jurisdiction under s 82.
Result: The Defendants' application was dismissed.
JUDGMENT
Introduction
[1] The Co-Operative Societies Act 1993 was enacted to make provisions for, inter alia, the control and regulation of co-operative societies. The objective of this legislation is to promote the development of co-operative societies "in accordance with the co-operative values of honesty, trustworthiness and transparency in order to contribute towards achieving the socioeconomic objectives of the nation and for matters connected therewith". Part VIII of the Act deals with matters relating to Inspection, Inquiry, Dissolution and Disputes.
[2] The present matter before this Court requires it to examine in detail the ambit and application of a provision relating to the mechanism for the settlement of disputes as legislated in the Co-Operative Societies Act 1993 . It arose out of an application by the Defendants in encl 9 to strike out the Plaintiffs' Writ and Statement of Claim on the ground that this Court is not the proper forum to determine the dispute between the parties.
The Prevailing Poser
[3] The overriding issue raised in encl 9 is whether this Court is the proper forum to determine the dispute between the parties.
[4] In resolving the above issue, this Court is required to scrutinize the claims brought by the Plaintiffs against the Defendants and make a determination as to whether the dispute between the parties falls within the scope of s 82 of the Co-Operative Societies Act 1993 , thereby rendering the Malaysia Co-operative Societies Commission as the appropriate adjudicating body to hear the dispute.
The Plaintiffs' Main Action
[5] The Plaintiffs initiated a Writ action against the Defendants on 29 December, 2022.
[6] The Plaintiffs alleged, inter alia, that the Second to the Sixth Defendants had breached their statutory and fiduciary duties as directors of the First Defendant, a co-operative society. The Plaintiffs were at all material times, members of the First Defendant.
[7] At para [80] of their Statement of Claim, the Plaintiffs sought the following reliefs from the Defendants:
a) Bahawa suatu audit forensik oleh juruaudit bertauliah dijalankan ke atas Defendan Pertama dan Defendan Ketujuh secara menyeluruh dan telus;
b) Deklarasi bahawa perjalanan pengoperasian Defendan Ketujuh tidak menurut peruntukan yang terkandung dalam Undang-undang Kecil Defendan Ketujuh dan/atau Akta Koperasi 1993 dan/atau Peraturan-peraturan Koperasi 2010 dan/atau GP17: Garis Panduan Membentuk, Mempunyai, Memperoleh atau Menubuhkan Subsidiari oleh SKM dan/atau Akta Syarikat 2016;
c) Bahawa Defendan Kedua hingga Defendan Keenam secara bersesama dan/atau berasingan telah melanggar tugas statutori terhadap Plaintif-plaintif dan Defendan Ketujuh;
d) Bahawa Defendan Pertama telah gagal mengambil sebarang langkah yang sewajarnya untuk menghalang dan/atau memberhentikan pelanggaran tugas statutori oleh Defendan Kedua hingga Defendan Keenam;
e) Bahawa Defendan Kedua hingga Defendan Keenam secara bersesama dan/atau berasingan telah melakukan pecah amanah terhadap Plaintif-plaintif dan Defendan Ketujuh;
f) Bahawa Defendan Pertama telah gagal mengambil sebarang langkah yang sewajarnya untuk menghalang dan/atau memberhentikan kegiatan pecah amanah oleh Defendan Kedua hingga Defendan Keenam; g) Bahawa Defendan Kedua hingga Defendan Keenam secara bersesama dan/atau berasingan telah melanggar tugas fiduasiari dan tugas berhati-hati (breach duty of care) terhadap Plaintif-plaintif dan Defendan Ketujuh; h) Bahawa Defendan Pertama telah gagal mengambil sebarang langkah yang sewajarnya untuk menghalang dan/atau memberhentikan pelanggaran tugas fiduasiari dan tugas berhati-hati (breach duty of care) oleh Defendan Kedua hingga Defendan Keenam;
g) Bahawa Defendan Kedua hingga Defendan Keenam secara bersesama dan/atau berasingan telah melanggar tugas fiduasiari dan tugas berhati-hati (breach duty of care) terhadap Plaintif-plaintif dan Defendan Ketujuh;
h) Bahawa Defendan Pertama telah gagal mengambil sebarang langkah yang sewaj
